A federal judge in Nevada has ruled that a dry cleaning company is liable for groundwater contamination near its former cleaning facility under decades-old lease agreements. Voggenthaler v. Maryland Square, LLC, No. 08-1618 (D. Nev. 10/20/10). Plaintiffs, a group of residential homeowners, filed a complaint under RCRA seeking injunctive relief for contamination caused by the discharge of perchloroethylene (PCE) from an Al Phillips the Cleaners facility in Maryland Square Shopping Center in Las Vegas from 1969 until 2000.

In July 2010, the court found the former mall owner responsible under RCRA and entered an injunction ordering remediation of the site. Thereafter, plaintiffs sought dismissal of the group that owned the facility. The former mall owners appealed the July ruling and moved for summary judgment against the cleaner’s owners based on a countersuit alleging that the dry cleaner is the responsible party for the PCE contamination under lease agreements in which it promised to pay for claims against the mall owners in connection with any violations of the law occurring during the term of the lease.

The court examined the lease agreements, finding that they contained a guaranty under which the owners agreed to guarantee performance “of each and every one of the obligations of tenants under the lease,” including a guarantee to indemnify the mall owners for costs arising out of the contamination. The court therefore granted summary judgment against the owners of the dry cleaning facility.